I have a series EE savings bonds with issue date April 1992 and face value of $1,000. I've looked at the govt sites and simply can't figure out how much interest I'm CURRENTLY earning. I also can't figure out how much it's currently worth. Any ideas?

MB7 wrote:I have a series EE savings bonds with issue date April 1992 and face value of $1,000. I've looked at the govt sites and simply can't figure out how much interest I'm CURRENTLY earning. I also can't figure out how much it's currently worth. Any ideas?

4% with final maturity in 2022.That is extremely good yield in today's environment
John

An EE Bond with an issue date in the time period from November 1982 through April 1995 earns interest either

at a guaranteed rate or guaranteed rates; or
at a market-based rate (85% of 6-month averages of 5-year Treasury securities yields)

whichever category of rates, separately, by itself, over the entire period from date of issue, produces the higher redemption value for the bond.

4% is the guaranteed rate. But the market-rate based was higher in past years. According to a chart from that same Treasury website, the market-based rate never fell below 4% until 2002, and still was relatively high from 2002-2008. Today it is 0.76%.

It's possible that you banked a lot of money from the market-based rate in the 1990s, so the guaranteed amount based on the guaranteed rate is far behind. That would mean that you're effectively earning only 0.76% by keeping the bond today.

Yes, but when the tool says the bond is earning 4%, what is it describing? The guaranteed rate or the actual rate? Do we know how sophisticated the tool is?

The 4% is the 4% that's the guaranteed minimum under the Code of Federal Regulations for those EE Bonds.

§ 351.22 31 CFR Ch. II (7–1–12 Edition)
these yields and the resulting redemption values are described below:
(a) Guaranteed minimum investment yield and resulting values during an extended maturity period. A bond may be subject to one guaranteed minimum investment yield during its original maturity period and to another such yield during each of its extended maturity periods.

(2) Bonds entering an extended maturity period on or after March 1, 1993.
Bonds that entered or enter an extended maturity period on or after March 1, 1993, have a guaranteed minimum investment yield of 4 percent per
annum, compounded semiannually, during that extended maturity period, or the guaranteed minimum investment yield in effect at the beginning of
that period.

Clever_Username wrote:What do you do with a series EE bond when they stop earning interest? Do you have to cash it in right away?

You are required to pay the interest in the year that it reaches final maturity. If it's held at Treasury Direct they will cash it for you. Paper ones generally get a 1099 issued by the bank that cashed them in the year you actually do it. It's likely that the IRS would never know, but why take chances?

I now accept that the bond is actually earning 4%. I used the Savings Bond Wizard (http://www.treasurydirect.gov/indiv/too ... wizard.htm). Using the characteristics described, a bond would have a value of $1452.00 in May 2013. It would have been worth $1395.60 in May 2012. So, in the last year it earned 4.04%. You should check for yourself using the Wizard.

Clever_Username wrote:What do you do with a series EE bond when they stop earning interest? Do you have to cash it in right away?

You are required to pay the interest in the year that it reaches final maturity. If it's held at Treasury Direct they will cash it for you. Paper ones generally get a 1099 issued by the bank that cashed them in the year you actually do it. It's likely that the IRS would never know, but why take chances?

Brian

Thanks. Yeah, I wouldn't try to hide it; it's just that I believe I'll be in a lower tax bracket in 2014 than 2013, so if I had the (legal!) option of deferring until then, I would.

"What was true then is true now. Have a plan. Stick to it." -- XXXX, _Layer Cake_

Not true. Don't believe everything you read. $5.00 gets you in. Give them a call. I live in NJ. Just opened what will probably be the first of three $10000.00 accounts. I use the heck out of my debit card, so it should be no problem satisfying that requirement. I did this with Danvers Bank from Mass for a couple years, and then with People's United when they took over Danvers Bank. Unfortunately, they changed it. But switching banks is just a few keystrokes.